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Council denies Nanaimo Recycling Exchange funding request

The Nanaimo Recycling Exchange is poised to be closed for good after City Council refused to provide necessary capital funding for the non-profit organization. Ian Holmes/NanaimoNewsNOW

NANAIMO — City Council has voted not to fund the Nanaimo Recycling Exchange, which had lobbied for local government funding to open and operate a new facility.

A City news release stated council opted not to proceed with capital funds and a one-year operating grant for the non-profit recycler after receiving advice from legal and finance staff.

The NRE repeatedly asked the City for $6.05 million to construct a new facility on NRE -owned land beside its current location, which closed in late March. NRE executive director Jan Hastings long claimed the City's backing for capital support was required for the organization to re-open.

Mayor Bill McKay, a vocal NRE supporter, said there were too many unknowns about the negotiations and there were too many risks involved.

He cited numerous “extenuating circumstances," such as the risk of a changing landscape in the recycling industry, giving the funding without taking bids from other potential operators, and the private businesses who said they could improve the situation and fill any gaps in service left by the NRE.

McKay, who joined coun. Diane Brennan as the only two votes in favour of giving the funding, said he's disappointed in the decision and predicted diversion efforts will go backwards unless private enterprise steps up, which they've promised numerous times.

"We know there's a lot of work to be done and we're trying to achieve very lofty goals as set by the RDN. This is going to be a real challenge."

If approved, the cost of the new NRE facility would have been added to garbage user fees.

Coun. Ian Thorpe said the financial risk to the City was a major concern to him.

"They have my total sympathy for the work they've done over the years, but they're in a financial position now where basically I think the hole is too large for the City itself to support them."

Thorpe said he's a strong NRE backer and wanted to offer the necessary funding, but said their ask was simply too large.

"I could not justify that amount of City money and City risk to one organization, it was a very hard decision to make."

Coun. Sheryl Armstrong told NanaimoNewsNOW funding the NRE would essentially put the City in the recycling business, which she said would carry significant financial risk.

She said another aspect of the debate left under the radar is the harm pumping millions of dollars into the NRE would have on several other local non-profit organizations.

Armstrong said the NRE's proposed expanded community market was concerning to her.

"There are groups (non-profits) that rely heavily on selling items like furniture wondering 'Can we get access to that kind of City funding too?'"

NRE vice-chair Ben Geselbracht said the board would meet to discuss a response and they were not prepared to make a statement.